Lost this bid. How much would you have charged?

-- 1 --

Part 1 - I was approached by a repeat customer about building some custom shelving units. See photo and note the dimensions...pretty big units. the quote was for 6 -8 of them built kd style so they could be built in my shop, crated and shipped to NYC and assembled there. Oh, they were also to have a 3/4" back incorporated so that hang hooks could be mounted to the backside.

I charged him about 400$ per unit for a total of 2400$ ( for 6 ) which would include my pay and profit. That does not include materials.

He apparently didnt like the price because he came back several days later with...

Part 2 - see photograph. This time he wanted framing lumber and pipe fittings delivered to the NYC gallery and waiting on me. I would come up for a weekend and basically build these things on the floor with a circular saw and 18v impact, then apply finish on site as well. The units would have been the height of the last photo with as many shelves..shelves 18" deep just as first photo. I estimated it would take me 2-3 full days to have them cut/glued up, finished and assembled. This method would make me have to do the bulk of the build with basic tooling and no bench and have to stay 3 nights in NYC rather than 1 night with the first type build. He also nixed the 3/4" backs on the second way. I quoted him $1500 to come to,NYC for 3 nights, crate a small collection of tools up there, build, finish, and clean the grease off of all those galvanized pipe fittings...

He got back to me a couple of days later saying they were going with a pre-made solution to save money. And I get that.

But we're my prices out of line or was he just trying to get a lot for a,little?

Well thanks for the responses. I feel better about my prices now. I don't think I could charge what was recommended. I figured about 80 hours of build time at 27$ per hour plus a mark up on materials plus profit. Good enough for me...also he is a repeat customer who I make a pretty penny from during trade show months.

On the NYC build I figured 30 hours of work at 50$ an hour and all expenses paid...again was fair for me for 3 days.

Matt, You are someone we would call a "Good Guy". I am serious. More seriously, do you have free rent & utilities? Do you have business insurance? Are you investing in an IRA. Your client seems lacking in appreciation of your services. Hurts to be less than kind, but I submit you undervalue your skills. Good luck & hope your business picks up.

Thomas, I didn't take offense to anything you had to say and I appreciate your input. I get what you were getting at. Yes my 'shop rate' is very low. I do this as a side gig these days until business improves so that I could work full time at it and make a living. Until then I have a full time job... I work out of my basement shop so yes rent and utilities are pretty much taken care of.

I'm sure I could charge more, but honestly I just don't have my feet wet enough in the custom stuff to know what a fair market price is. I have cabinetry down pretty good. I spent 5 years running a residential cab shop but that was the same stuff 95 percent of the time.....easy to price with a multiplier...

I'd say your hourly rate is going to run about half or less of the average, which I think these days is in the $65+/- range. So in comparing your prices you way underbid those units. That doesn't mean you couldn't build them and make some money for yourself. Just in comparison of what the market rate would come in at in general.

If you can make money with this guy that's great. But just be aware if he's in NYC and he's using you it's for one reason only….b/c your the cheapest guy he can find. I'd guess if he was turning around and selling them in his gallery he'd probably be charging that $2400 for each one! If you don't believe me take a look in a couple galleries next time your up there and you'd be amazed at the prices they get for average and sometime poor quality product.

Thanks Jeff. Yes I figure my hourly rate is low, but my projected hours is probably high!!! They were all to be identical so after a few jigs/templates were made and the machinery setup it would probably be pretty quick work. BUT like I said I'm not as experienced with the custom stuff and I sometimes end up about 50% more time than I originally thought. So I close to doubled the time on this one.

And these weren't to be resold. They were to be display shelving for a homegoods/textile showroom. I guess not a gallery per se...my bad.

Thanks again. I'll probably end up charging more per hour if for no other reason than to give other guys a shot who also need the work. Besides, I could definitely use the extra money.

Let me suggest a few more things. First, do not use a round number, like $400. Rather use a more precise value that reflects the idea that you have figured out the cost very closely and it is the bottom line. For example, use a value of $403.77 each. Similarly for travel...state that you will charge a professional fee of $80 per hour for assembly plus actual travel expenses, estimated to be $ 780. Your fee will hardly cover the parking for you vehicle. In the future, suggest that a local helper would save time and money.

Second, use a technical name for the item that reflects its uniqueness. Perhaps include "extra strength" and environmentally pleasing. Point out that you or someone else can easily maintain and repair if they are abused. Mention that they are well design to avoid racking, carry heavy loads, etc. there is no question that your cost reflects quality that does not exist in the units they are going to get....your quality is deserving for a quality gallery.

Finally, as a general rule, anyone who buys on price, rather than quality and delivery, is likely to be the same person who complains.

Overall, it is clear that you have an awesome product and service, but it sounds like you do not have a representative that told the customer all the benefits of having your products and services. You have to "toot your own horn" as no one else will do it.

Incidentally, Matt, that second design with a load on it and then the cart hits a bump or threshold would easily fail...those pipes are not that strong. Certainly the 3/4" back is an important structural item for heavy loads and or abuse.

Here's a link to the seller of the Fowler Shelf - DOV906.
Your client shows you the pic and then says $400 each is too high priced correct??
You should send them this and start to look up names and part numbers of things that look like catalog items. It happens everyday.

And yes you're right about the second set's design flaws but after he changed gears after so much research and pricing on my part, I didn't have the energy to get into that with him. I started to get the feeling he was looking for dirt cheap and I wouldn't be able to help him...

Scott, yes I found a price online for the fowler shelf. IT raged from 1700-2k. I told my customer I could do (1) for 2k$, but I could do 6-8 for 1600$ each. I then told him I could get it down further if we nixed all the distressing and antiquing. He disappeared for a few days an then countered with that pipe fitting idea. As I said earlier, I knew then I had lost it...and didn't really want to do it anymore if I couldn't do the work in something even remotely resembling a shop.

Matt - I think your goal should be to charge the going rate. Too many novices spend all their energy trying to do things for less money, and then end up in a starvation trajectory, cutting their own throat. Once you get a reputation for doing things for too little money, how can you raise prices? If your business model does not include a reasonable hourly rate, how do you charge such a rate when you really need to?

Scott has it right - you looked this up and knew what the real cost was - no secrets on the internet, eh? I have told people for years that if they can find what they want on the shelf, then they need to buy it. If not, then maybe we should talk.

You're right there's no doubt. Part of my problem stems from not knowing how long stuff like that is going to take me. More custom experience will guide me there. You do fantastic work btw. I wish I could have spent my apprentice years under someone who puts out work of your caliber. I'd probably still be in 'helper' category though.

matt ; have same problem but I've been doin this for 30 yrs. its the people who think we are so desperate that we will not only work for free today but maybe kick in a little cash to get our work out there , I priced a table top last week for a neighbor and his son was going to help I was only charging for material but I was to high , and a builder told me 2 yrs. ago that I wasn't hungry or I'd work for $10.00 per hour , and I get to pay the electric and phone , taxes ect out of that ,figure I might make $3to4.00 per hour maybe ,but theres nothing for machine maintaince .. the American consumer has gotin so cheap they just need to go to china for what they want every place else is to high . bob

Matt I see I am answering this a little late and I know how you feel when you lose a job, we've all been there. When you are slow that is when you tend to look over things, big mistake. Consider yourself lucky. I am gonna educate most guys on this forum now and not for the reason you may think. I'm in this business a long time and I know I couldn't shine the shoes of most you guys. I should say helpful guys. I lived in Brooklyn most of my life and when I heard of an opportunity to do work in Manhattan my eyeballs turned to dollar signs. If I arrived at a price of 10k I would double it. No lie. I would get it anyway. But at the end of the day which took me 6 yrs to learn I would still break even or.... Don't for get Im a New Yorker and know the ropes. You ask why well my fingers are hurting me here but Ill type a little more. Can't use the main entrance so you have to go around the block (2 hours). Find the service elevator for the building but you cant stop. I didn't say park I said stop. They will tow you away steal your tools etc. It will cost you about 1500 and you didn't get in the building yet. So you go around the corner (2 Hours) sneak a delivery and now you have to go to the 199th floor. (If anyone is laughing Im not kidding) You push the elevator and wait only to find out you have to go in the basement to find the operator because he has the key and is in the union. You walk down 3 flights to the basement to find the operator and there is 40 to 50 boilers the size of small houses all running at the same time. Deafening. You try to call for this guy but forget it. Finally find him and he gives you a song and a dance why he cant take stuff up. Don't forget Im a New Yorker. So $500 later and $100 every other time I found out how and where to get him. This is just a small part of the stories I have working in Manhattan. It is a great place to be on Christmas time with the kids but the rest of the time...... One good part is in the summertime there are a lot of good SITES walking around. Im 70 but not dead yet. Thanks to all you guys that have answered my stupid inquiries before.

WOODWEB is a professional industrial woodworking site. Hobbyist and homeowner woodworking questions are inappropriate.

Messages should be kept reasonably short and on topic, relating to the focus of the forum. Responses should relate to the original question.

A valid email return address must be included with each message.

Advertising is inappropriate. The only exceptions are the Classified Ads Exchange, Machinery Exchange, Lumber Exchange, and Job Opportunities and Services Exchange. When posting listings in these areas, review the posting instructions carefully.

Subject lines may be edited for length and clarity.

"Cross posting" is not permitted. Choose the best forum for your question, and post your question at one forum only.

Messages requesting private responses will be removed - Forums are designed to provide information and assistance for all of our visitors. Private response requests are appropriate at WOODWEB's Exchanges and Job Opportunities and Services.

Messages that accuse businesses or individuals of alleged negative actions or behavior are inappropriate since WOODWEB is unable to verify or substantiate the claims.

Posts with the intent of soliciting answers to surveys are not appropriate. Contact WOODWEB for more information on initiating a survey.

Excessive forum participation by an individual upsets the balance of a healthy forum atmosphere. Individuals who excessively post responses containing marginal content will be considered repeat forum abusers.

Responses that initiate or support inappropriate and off-topic discussion of general politics detract from the professional woodworking focus of WOODWEB, and will be removed.

Participants are encouraged to use their real name when posting. Intentionally using another persons name is prohibited, and posts of this nature will be removed at WOODWEB's discretion.

Carefully review your message before clicking on the "Send Message" button - you will not be able to revise the message once it has been sent.

You will be notified of responses to the message(s) you posted via email. Be sure to enter your email address correctly.

WOODWEB's forums are a highly regarded resource for professional woodworkers. Messages and responses that are crafted in a professional and civil manner strengthen this resource. Messages that do not reflect a professional tone reduce the value of our forums.

Messages are inappropriate when their content: is deemed libelous in nature or is based on rumor, fails to meet basic standards of decorum, contains blatant advertising or inappropriate emphasis on self promotion (return to top).

Libel: Posts which defame an individual or organization, or employ a tone which can be viewed as malicious in nature. Words, pictures, or cartoons which expose a person or organization to public hatred, shame, disgrace, or ridicule, or induce an ill opinion of a person or organization, are libelous.

Improper Decorum: Posts which are profane, inciting, disrespectful or uncivil in tone, or maliciously worded. This also includes the venting of unsubstantiated opinions. Such messages do little to illuminate a given topic, and often have the opposite effect. Constructive criticism is acceptable (return to top).

Advertising: The purpose of WOODWEB Forums is to provide answers, not an advertising venue. Companies participating in a Forum discussion should provide specific answers to posted questions. WOODWEB suggests that businesses include an appropriately crafted signature in order to identify their company. A well meaning post that seems to be on-topic but contains a product reference may do your business more harm than good in the Forum environment. Forum users may perceive your references to specific products as unsolicited advertising (spam) and consciously avoid your web site or services. A well-crafted signature is an appropriate way to advertise your services that will not offend potential customers. Signatures should be limited to 4-6 lines, and may contain information that identifies the type of business you're in, your URL and email address (return to top).

There are often situations when the original message asks for opinions: "What is the best widget for my type of shop?". To a certain extent, the person posting the message is responsible for including specific questions within the message. An open ended question (like the one above) invites responses that may read as sales pitches. WOODWEB suggests that companies responding to such a question provide detailed and substantive replies rather than responses that read as a one-sided product promotion. It has been WOODWEB's experience that substantive responses are held in higher regard by our readers (return to top).

The staff of WOODWEB assume no responsibility for the accuracy, content, or outcome of any posting transmitted at WOODWEB's Message Boards. Participants should undertake the use of machinery, materials and methods discussed at WOODWEB's Message Boards after considerate evaluation, and at their own risk. WOODWEB reserves the right to delete any messages it deems inappropriate. (return to top)

Forum Posting Form Guidelines

Your Name

The name you enter in this field will be the name that appears with your post or response (return to form).

Your Website

Personal or business website links must point to the author's website. Inappropriate links will be removed without notice, and at WOODWEB's sole discretion. WOODWEB reserves the right to delete any messages with links it deems inappropriate. (return to form)

E-Mail Address

Your e-mail address will not be publicly viewable. Forum participants will be able to contact you using a contact link (included with your post) that is substituted for your actual address. You must include a valid email address in this field. (return to form)

Subject

Subject may be edited for length and clarity. Subject lines should provide an indication of the content of your post. (return to form)

Thread Related Link and Image Guidelines

Thread Related Links posted at WOODWEB's Forums and Exchanges should point to locations that provide supporting information for the topic being discussed in the current message thread. The purpose of WOODWEB Forums is to provide answers, not to serve as an advertising venue. A Thread Related Link that directs visitors to an area with inappropriate content will be removed. WOODWEB reserves the right to delete any messages with links or images it deems inappropriate. (return to form)

Thread Related File Uploads

Thread Related Files posted at WOODWEB's Forums and Exchanges should provide supporting information for the topic being discussed in the current message thread. Video Files: acceptable video formats are: .MOV .AVI .WMV .MPEG .MPG .FLV .MP4 (Image Upload Tips) If you encounter any difficulty when uploading video files, E-mail WOODWEB for assistance. The purpose of WOODWEB Forums is to provide answers, not to serve as an advertising venue. A Thread Related File that contains inappropriate content will be removed, and uploaded files that are not directly related to the message thread will be removed. WOODWEB reserves the right to delete any messages with links, files, or images it deems inappropriate. (return to form)

The editors, writers, and staff at WOODWEB try to promote safe practices.
What is safe for one woodworker under certain conditions may not be safe
for others in different circumstances. Readers should undertake the use
of materials and methods discussed at WOODWEB after considerate evaluation,
and at their own risk.